As regulators around the world increase their scrutiny of crypto exchange Binance, some of its banking partners are cutting ties with the platform. On Thursday, June 29, Paysafe Payment Solutions, a European banking partner of Binance, said that it would stop providing embedded wallet services to the exchange in the European Economic Area (EEA), starting from September 25.
Paysafe announced that it will gradually end its service to Binance, the crypto exchange platform, in the coming months. The company communicated this decision to Reuters via email.
This means that Binance will have to find a new provider for its Euro transactions through the Single Euro Payments Area (SEPA). It is not known yet which provider Binance will choose next. Binance relies on payment intermediaries to access SEPA.
Binance Continues to Lose Ground in Europe
Binance partnered with Paysafe last year to allow its users to deposit British pounds using Faster Payments. Faster Payments is a system that handles payments and transfers between bank accounts in the UK.
As part of a deal with the SEC, Binance and its US branch have agreed to keep the funds of their US clients within the US borders. This arrangement will last until the SEC’s lawsuit against Binance is settled. The lawsuit accuses Binance of violating securities laws by offering unregistered crypto products to US investors.
Binance, the crypto exchange, has seen its market share decline after the SEC took regulatory action against it in June. However, even with this setback, Binance remains the leading global cryptocurrency exchange in terms of volume and users.
Binance has encountered several difficulties with regulators and banks in different parts of the world. The company lost its license to offer derivatives products in Australia in April, which led to the termination of its relationships with local payment providers and financial institutions. Binance Australia then decided to exit the market. Similarly, Binance withdrew from Canada last month in response to new crypto regulations that were introduced in the country.
The company has also faced regulatory hurdles and scrutiny in Europe. It failed to register itself in the Netherlands and announced its departure from the country on June 16. It also faced an investigation by French authorities who questioned its decision to set up its European headquarters there. Moreover, on June 23, Binance was ordered by Belgian regulators to cease its operations in the country.
